The Colombo Port City project, which is 100% privately funded foreign direct investment of $1.4bn by CCCC, commenced construction after the signing of an agreement with the government of Sri Lanka in September 2014.
Sri Lanka has decided to suspend the mega port city project, citing concerns over the project’s environmental impact and regulatory issues.
With China putting billions of dollars into the project, Beijing is now investing diplomatic efforts to restore the construction of the port city.
In a recently held meeting, Chinese ambassador to Sri Lanka Yi Xianliang has asked the Sri Lankan side to respect bilateral agreements and business contracts, and protect the interests of its investors, China’s Xinhua reported.
Sri Lanka’s deputy minister of justice Sujeewa Senasinghe, on the other hand, said that new laws were being compiled to investigate allegations of large scale fraud in transactions with China.
Under the port city plan, 108 hectares of land next to the main commercial port of Colombo would be taken over by CCCC on a 99-year lease. The development would include shopping malls, water sports, golf courses, hotels and apartments.
CCCC said over 200 metres of the breakwater constructed so far has been damaged due to the suspension, as the company was unable to take measures to protect the reclaimed land due to the suspension.
Last month, Sri Lankan prime minister Ranil Wickremasinghe set up a special committee to probe allegations of corruption activities at the Chinese funded project.
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